I wrote this in response to a comment left by David Croty – who is one of the guys at the great site, The Scholarly Kitchen – at my previous post on the blowup at Scienceblogs.
The inherent problem is that the best interests of the company running the social network often are in direct opposition to the users of that social network. In the case of Facebook, their profits are going to be reliant on selling out the privacy of their users. In the case of ScienceBlogs, commercialization alienated the strongly anti-business, anti-industry members of their community and threatened their perceptions of themselves as an elite and well-respected group of experts.
One can, as you suggest, focus instead on serving those users but that’s a mighty difficult thing to monetize. If you’re a corporation with investors who would like to be paid back (like Seed Media), you need some way to make money. Perhaps running social networks will fall out of fashion as a profit-making enterprise due to these conflicts.
It was getting pretty long so I made it a post.
David, That is part of what I am trying to delineate. Scienceblogs went and created this community of blogs, hoping it would drive more traffic to their magazine and its website. But the magazine failed and the magazine website is not making nearly the inroads as the Scienceblogs are.
Seed Media simply did not realize that Scienceblogs had become this community – any group that can decide to strike is a community of people – with an focus independent of Seed..
Its business model for these blogs simply is not sustainable, even if it was full of pro-business, pro-industry people. Seed as looking for a bunch of well-written, independent voices. They got those in spades. The writers are always going to be independent, to the detriment of Seed when their motives conflict. Which it is almost bound to do because Seed’s focus was on getting advertising money, not on servicing the community created by the bloggers. A similar problem is seen in newspapers.
A better business model would be to find ways for the Scienceblogs to be sustainable in themselves, I can think of a couple of ways but it requires an organization quite different from something like Seed, which seems to be still trapped in the era of magazines and print.
Frankly, it is extremely difficult to monetize any sort of social community that is digital and open. It is not only too easy to create an ad hoc social community but, in the era of Web 2.0, it is too easy for members of the social network to leave and create another ad hoc community. The community want to support the community’s needs and wants, not necessarily the needs of the founding institution. Something Facebook would do well to consider.
So, where to make money? Well, if you have the right niche, you might make it by charging admission online. Essentially, the WSJ and science journals, such as Protocols, can do this and survive. They fulfill a need for a specific sort of information – which the community realizes costs money and is hard to create – and do not need the same network effects (think Metcalfe’s law) as Facebook to be successful.
Not so for Facebook and Scienceblogs. The content is easier to create and costs less to produce but it also harder to make sticky, holding onto readers in a way to make much money. So, how to create a sustainable business? Well, one way would be to make money on the things that can not be digitized – the human angle.
Thus, whoever takes control of nurturing the Scienceblogs community makes a business out of that by servicing the community it creates. How, and still make some money? Off the top of my head – have a yearly conference where they bring together their bloggers with the people who follow them. Perhaps take some of them out on tour. Looking at the successful nature of w00tstock, this can be a pretty interesting model. They could even host a scientific/non-scientific conference. Or a TED-like symposium. Or one on how to communicate science. Or one on atheism vs. religion. Or one on evolution. I would pay to see PZ and others. The bloggers could receive compensation for this and I would imagine the meetings could become quite popular.
And also realize that the community also encompasses all those that read these blogs. So, if people pay a yearly fee, they can get reduced prices to attend the symposia/meetings. Or maybe a special edition of The Best of Scienceblogs.
The point is that many of the creators of these blogs write about going to meetings or panels or debates. And many of the readers of these blogs would love first-hand contact with the bloggers. How about a business model where sponsoring these events is a money-making opportunity?
O’Reilly has a similar sort of model where it publishes specialized books for a variety of high tech communities but also puts on a set of conferences that bring together the various members of its communities. These are quite highly attended. The conferences drive book sales and the books drive the conferences.
Of course, this would require a very different organization than Seed currently occupies and may not be as interesting to some investors.
But, if a different set of investors wanted to produce a real organization that serviced the community it created (and probably have many more creative ideas that I can come up with), I think it could be sustainable.
I agree with you that organizations that simply make their money by online social networks will have a hard time because the profit motive often goes against the community’s wants. When that happens, the community may very well migrate somewhere else. To survive, Facebook and others may need to figure out ways to monetize servicing the community, not the advertisers.